There’s no denying that the market (and customer behaviour) is changing. The recent Salmat Marketing Report revealed that for 83% of consumers, price is their number one influence on a purchase decision. Two in five shoppers no longer consider brands when shopping, and only 18% are loyal to one or two brands. In fact, 65% will switch to another brand if a product is on sale or comes with an incentive.
This is where being local can have its advantages, particularly when it comes to letterbox marketing. This powerful marketing channel is a direct route into the homes, the hands — and the hearts, if you get it right — of your current and potential customers.
And because of its cost-effectiveness, it’s not the exclusive domain of the big players. Here’s how it works at Salmat: A ‘walker’, someone delivering catalogues, usually operates within six to 10 streets around where they live. Typically this represents about 300 houses.
Because of that we can get very close to a small or medium retailer’s home territory and, by adding new localised areas as we move out in concentric circles from the store’s physical location, we can target the required quantity of households in the business’s local area.
Localising the delivery area is not all we do to ensure we hit a precise target market. There is a range of demographic targeting options available.
Let’s say you run a beauty salon. You might want to target women of a certain age and income range. We can tell you the type of people in each of our local area sections, and if one section has a higher percentage of that specific demographic. If a section has a low percentage of that demographic in your desired market, we can remove it so that your letterbox piece goes only to a relevant, local audience.
How to compete with the big retailers
By making localised offers, and ensuring your letterbox piece includes a location map that clearly illustrates how close your business is to the customer’s house, a small or medium business can compete with major retailers by demonstrating value. Price is very important, but so is value.
If you have to drive for 40 minutes to get something for $200, but your local store, which is just a five-minute walk or drive, is offering the same product for $220, that convenience represents great value.
A local business also offers so much more in terms of value. They offer local expertise and after-sales service. They offer local returns and exchanges and local knowledge.
Letterbox is just the beginning of a relationship
The specific type of message that you send doesn’t have to be a DL, double sided, black-and-white flyer. By localising the message and hitting the right demographics you’re saving money on getting the message out there, so you can invest more in the piece. Think of die-cut shapes, magnets, coupons and loyalty cards. Something that showcases your brand and that people can hold on to, stick on their fridge or place in their wallet works really well to capture an audience and drive consumer behaviour.
This is why groups like real estate agents, pizza shops and fast food outlets deliver memorable or useful pieces of mail. The local coffee shop might distribute a coupon in the shape of a coffee mug. The local fruit shop might deliver a piece of mail in the shape of an apple. The real estate agent might do a calendar with a magnet.
The intention is for it to be something that engages the residents of that local area and be a piece that they might use at a given point in time. It could be about creating brand awareness in the local area for future purchase consideration.
This brings us to the most important point. The local-area-marketing mail campaign should not be a one-off. It should not stand alone. It’s not just about driving people into the store once. It’s about driving the path to purchase, and then repurchase and repetition.
It might start off with a coupon to be used immediately, which then leads to an offer of a loyalty card for which the customer must register their details online. The customer uses the coupon to receive their first discount, then the loyalty card for future discounts. Think of the way cafes often offer a membership card that offers a free coffee after every five purchased.
This then leads to a multi-channel approach. The customer is sent a welcome email, receives monthly updates and offers, then every second Friday they receive an SMS with special offers for the coming week. The local business then has the ability to do something that big businesses often can’t — they can pivot their message to beef up parts of the week where business might be a little bit slow.
For example, a Monday morning for a beauty salon might be the quietest time. So on Friday afternoon the business can send an SMS blast promoting discounts for appointments on Monday between 9am and midday.
Those sorts of offers are possible because the business created awareness through the letterbox and built a database online through the coupon, promotion, competition or loyalty offer. Then loop it back by using the demographic and purchasing information to further refine their next letterbox drop.
You can also go one step further with letterbox sampling delivering free product samples or coupons direct to the homes of prospective customers. As there’s less brand loyalty these days (with customers swayed by price), sampling is a great way to get them to switch brands.
Letterbox sampling is also ideal for establishing a new brand or product range, increasing market share in a target location, driving brand awareness, and gauging consumer response.
Better targeting brings better results
Salmat offers clients a simple but potent, letterbox media targeting tool, SwiftPlan.
Clients can plot their location then build, around that location, a catchment. It allows you to build your own target audience. It can be set, for example, to cover up to a maximum of 15 minutes’ drive from the shop. All of this takes just a few minutes and, once set, SwiftPlan tells you how many letterboxes are in that area, what it’s going to cost and how many people you’ll reach.
A user can also overlay a range of demographic options. So again, if you own a beauty salon you can overlay household-spend data with spends on health and beauty services. A gym owner could overlay spends on gym memberships with desired age groups.
Salmat used this technology when planning yearly campaigns for a outdoor clothing customer who wanted to refine the distribution areas in which they were operating. They conducted market research and noted a difference between customers they were attracting and customers they wanted to attract. Using SwiftPlan, Salmat were able to accurately plot all of the local stores and, in less than five minutes, completely map and realign all of the letterbox distribution catchments for their 17 stores.
This immediately resulted in a 15% volume efficiency (which was reinvested), and which also meant they were able to increase some of their catchments and reach more of those people. It meant they were able to market smarter by truly knowing their local areas.
So why not turn the fact that you’re the local player into an advantage? It’s time to even up the playing field.
Find out more about how we can help you reach, convert and serve your customers here or call us on 1300 725 628.